Uneven Cash Flow Stream Find the present values of the following cash flow streams. The appropriate interest...

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Uneven Cash Flow Stream
Find the present values of the following cash flow streams. Theappropriate interest rate is 6%. (Hint: It is fairly easyto work this problem dealing with the individual cash flows.However, if you have a financial calculator, read the section ofthe manual that describes how to enter cash flows such as the onesin this problem. This will take a little time, but the investmentwill pay huge dividends throughout the course. Note that, whenworking with the calculator's cash flow register, you must enterCF₀ = 0. Note also that it is quite easy to work theproblem with Excel, using procedures described in theCh04 Tool Kit.xlsx.) Do not roundintermediate calculations. Round your answers to the nearestcent.
Year Cash Stream A Cash Stream B
1 $100 $300
2 400 400
3 400 400
4 400 400
5 300 100
Stream A: $
Stream B: $
What is the value of each cash flow stream at a 0% interestrate? Round your answers to the nearest dollar.
Stream A $
Stream B $

Answer & Explanation Solved by verified expert

4.2 Ratings (580 Votes)

a CF A Discount rate 006 Year 0 1 2 3 4 5 Cash flow stream 0 100 400 400 400 300 Discounting factor 1 106 11236 1191016 1262477 1338226 Discounted cash flows project 0 9433962 3559986 3358477 31683747 2241775 NPV Sum of discounted cash flows NPV CF A 13272 Where Discounting factor 1 See Answer

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Uneven Cash Flow StreamFind the present values of the following cash flow streams. Theappropriate interest rate is 6%. (Hint: It is fairly easyto work this problem dealing with the individual cash flows.However, if you have a financial calculator, read the section ofthe manual that describes how to enter cash flows such as the onesin this problem. This will take a little time, but the investmentwill pay huge dividends throughout the course. Note that, whenworking with the calculator's cash flow register, you must enterCF0 = 0. Note also that it is quite easy to work theproblem with Excel, using procedures described in theCh04 Tool Kit.xlsx.) Do not roundintermediate calculations. Round your answers to the nearestcent.YearCash Stream ACash Stream B1$100$3002400400340040044004005300100Stream A: $ Stream B: $ What is the value of each cash flow stream at a 0% interestrate? Round your answers to the nearest dollar.Stream A $ Stream B $

Year	Cash Stream A	Cash Stream B
1	$100	$300
2	400	400
3	400	400
4	400	400
5	300	100